The organization’s Director of Economic and Business Development is describing the Knoxville region’s only locally-based and active Community Development Financial Institution (CDFI). Authorized more than two decades ago, the federal program promotes community development in distressed urban and rural communities by increasing the availability of credit, investment capital, and financial services.

“We help people get to a position where they are eligible for more traditional funding,” Carter explains. “CDFI is intended to be a high risk program.”

With KAUL’s focus, it makes sense that the non-profit would include a CDFI in its portfolio of services. Southeast Community Capital Corporation, founded in Knoxville by the recently shutdown Tech 2020 and now doing business as Pathway Lending out of Nashville, has a statewide footprint.

Carter notes that KAUL is the only locally-based CDFI and also the only urban league affiliate in the country to earn the CDFI designation, something that is awarded by the U.S. Department of Treasury. KAUL secured its designation in December 2013, and Carter joined the organization in April 2014 to run the new initiative and leverage capital from lenders and other technical assistance to benefit underserved entrepreneurs.

“We are trying to grow from $3.5 million to $25 million over the next five years,” he says.

For Carter and KAUL, it’s more than just loaning money; it’s also about providing training and support services that help grow sustainable businesses.

“We have a mandatory requirement that any start-up that applies for and/or that is approved for a loan must go through the CO.STARTERS program” he says. The nine-week curriculum was created at Chattanooga’s CO.LAB and recently spun out into a separate entity named Get Started.

While KAUL is utilizing the CO.STARTERS program, it has also added an additional week that is focused on developing the start-up’s business plan. That effort is helped by another local group.

“We work with SCORE,” Carter says in reference to the program that engages retired, but seasoned business executives as mentors. “Every participant has an assigned SCORE counselor.”

After the 10-week experience, many of the participants have a chance to pitch for a $10,000 investment in their business. To be eligible, Carter says they must have a real business plan, have conducted real interviews with at least 30 potential customers, and not missed more than two classes.

“If you are not willing to invest in yourself, who do you think will invest in you,” he says.

KAUL has held four CO.STARTERS classes that were attended by 43 participants. A fifth launched September 10 on Saturday mornings. Three of the 43 graduates have gone on to participate in the Knoxville Chamber’s Propel program.

“It’s all about revitalizing communities through entrepreneurship training and business growth that help empower people,” Carter says of KAUL’s efforts.